Gold is still stuck in its tight range this morning, trading around $4,052 by 09:50 GMT. Even with the heavy sell-off in US equities overnight, the metal has struggled to break higher, caught between fading rate-cut hopes and pockets of safe-haven demand.
Gold dipped during Asian hours but recovered slightly in early European trade. A firmer dollar, supported by cooling expectations for a December rate cut, continues to cap any upside. Signs of labor-market resilience and sticky inflation have given the Federal Reserve little urgency to ease policy, keeping traders cautious.
Markets now price a 28.5% chance of a 25-basis-point cut at the 10 to 11 December meeting. That’s up from yesterday’s levels but still far below last week’s 45.4%. Several Fed officials speak later today, while fresh PMI data will offer an early look at November’s economic momentum.
The Fed’s visibility remains clouded by months of delayed government data following the lengthy shutdown. September’s backlog will begin to clear next week, although October’s numbers may never be published, leaving policymakers short of key inputs.
Gold’s downside has been cushioned by renewed risk aversion. The global tech unwind deepened through Thursday and Friday, with even stronger-than-expected results from NVIDIA failing to calm nerves. Concerns over stretched valuations, rising inventories and questions around Nvidia’s financing arrangements all unsettled investors. The AI-fuelled run-up is now seeing some of its air escape, prompting traders to rotate cautiously back into havens like gold.